Frustrated execs clamor for action on bank nominees

Business leaders are enormously frustrated by Congress’s inaction on the Export-Import Bank, asserting that lucrative overseas deals are slipping away from American companies.

The 84-year-old agency has been without a quorum — at least three members of a five-member board — since late 2015. Without a quorum, the bank can’t approve loans of more than $10 million.

That’s just fine with conservative critics of the agency, who call it a form of corporate welfare and have fought for years to shut it down.

{mosads}Large companies including Boeing, which sells U.S. planes overseas, and General Electric frequently use the bank for loan guarantees and were instrumental last year in convincing President Trump to throw his support behind the bank. 

But smaller businesses have access to the bank as well.

Carlos Rapaport, for example, runs Amer-Con in Florida with his four brothers. The company had pursued a $250 million deal with the African country of Angola to provide 1,500 school buses and logistical support.

That deal, which had been in the works since 2014, fell through after a Brazilian company won the contract instead.

“We offered a better product, we offered better pricing than the Brazilian company but in the end the access to export credit agency was the difference-maker,” Rapaport said. 

Rapaport said losing the deal illustrates the problem smaller businesses like his, which employs 20 people, face when they generate large transactions that require board approval.

“The absence of a quorum has very much affected us in a very negative way,” Rapaport said.

The fallout from losing that deal puts 3,000 jobs at risk, the Rapaports said. 

Ex-Im has been without a chairman since Trump took office last year.

In December, the Senate Banking Committee approved four of President Trump’s nominees to the board, but rejected former Republican Rep. Scott Garrett (N.J.), Trump’s choice to lead the bank. 

In the five months since the committee voted on the Ex-Im nominees, Trump has not nominated anyone else to helm the agency. The other nominees have been stuck in a holding pattern due to opposition from Sen. Pat Toomey (R-Pa.), who is urging reforms at the bank.

Conservatives on and off Capitol Hill have cheered Toomey on while railing against the agency.

The Club for Growth has said Ex-Im provides “unnecessary subsidies bankrolled by the American taxpayer.” 

But while the Senate has been at an impasse, the Rapaports say competition for big export deals has grown increasingly fierce. 

“They must be celebrating, some of these other countries during the past three years, because we’re basically offline for projects of anything greater than $10 million,” Carlos Rapaport said.

Without a functioning bank, Amer-Con, which has been in business for 30 years, will likely lose another major deal in the near future, this one worth upward of $400 million, he said.

“We stay on top of news, we stay on top of politics in Washington, and we hear the president and Congress insisting that we need and want to win on trade and reduce our trade deficits and level the playing field for American companies,” Rapaport said.

“We take President Trump at his word that he supports Ex-Im Bank and wants to see it succeed, so we hope that these things are followed through with,” he said.

There are more than $35 billion in deals stuck in the Ex-Im pipeline due to the lack of a quorum. 

Last week, two Senate Democrats — Sens. Heidi Heitkamp (N.D.) and Sherrod Brown (Ohio) — tried to break the deadlock and confirm the four nominees to the board by unanimous consent, but Toomey objected.

Heitkamp has called the bank’s predicament “unilateral trade disarmament.”

“If we don’t have an Ex-Im Bank, we don’t have a fully functioning trade apparatus,” she said on the Senate floor. “That is truth. So it is time to put aside this petty squabble.”

Meanwhile, China is pumping billions into their export credit agency to compete against the United States, she said. 

Heitkamp argued that workers are “being held captive by an ideology that is going to fail us and doom our export effort to failure for not just the next couple of years but for a generation to come.

“The whole while, do you know what China is doing?”

While Heitkamp and Brown argue they are defending workers, Toomey said he is thinking about taxpayers.

The bank resuming large deals would “put taxpayers at risk and there would be no prospect of any meaningful reform,” Toomey said on the Senate floor. 

“I remain open to finding a new candidate who can lead Ex-Im and implement the kind of reforms that are needed, but that is not what is on the table at the moment, and until that time comes, I cannot support the confirmation of these additional board members,” he said.

It remains unclear whether the Trump administration will make a harder push for the Ex-Im board members to be confirmed.

During an April 11 House hearing, retiring Rep. Charlie Dent (R-Pa.), who has been a longtime backer of the Ex-Im, pressed Treasury Secretary Steven Mnuchin for answers as to how the administration will proceed. 

“You know, we’ve been having this battle now for years and the president states that he wants to see the trade deficit shrink,” Dent said. 

“Well, here’s a way we can do it and make some money for the Treasury in the process,” he said. 

Mnuchin told Dent that both he and the president want the bank to fully function.

“The president is very interested in reopening the Export-Import Bank,” Mnuchin said. 

Business groups, such as the National Association of Manufacturers and the U.S. Chamber of Commerce, have been exerting pressure on the Senate and the White House to make a move. 

“Unfortunately, the Ex-Im Bank hasn’t been fully functional since 2015 and all of its board seats are now vacant, which has left U.S. exporters and $37.5 billion worth of high-quality, ‘Made in the U.S.A.’ products hanging out to dry,” said Neil Bradley, executive vice president and chief policy officer for the U.S. Chamber of Commerce.

“The Senate Banking Committee has already approved, on a bipartisan basis, four highly qualified candidates to serve on the board, and swift action by the full Senate to confirm those nominees would give the bank the quorum it needs to get back up and running,” Bradley said. 

“But as long as the seats remain vacant, U.S. businesses are at a disadvantage relative to global competitors,” he said.

Manufacturers argue that the United States has lost billions in deals and the delay is putting tens of thousands of American jobs on the line.

“Manufacturers and the many Americans whose jobs depend on the Export-Import Bank need the Senate to act to restore a quorum on the bank’s board of directors,” said Linda Dempsey, vice president of international economic affairs at the National Association of Manufacturers, in a Friday blog post. 

“That’s what we have repeatedly urged. That’s what members of both parties understand, and are echoing at this week’s [Ex-Im] conference. That’s what our country needs as soon as possible,” Dempsey said.